The UAE is set to put forward draft laws that will look to implement a new taxation system, as the government looks to increase state revenues.

The drafting of the laws is expected by the final quarter of this year, according to a report by UK-based news agency Reuters.

It is understood the UAE may look to introduce some sort of value-added tax (VAT) and corporate tax despite the country’s reputation as an international tax haven.

Previous reports have suggested the UAE is reluctant to adopt VAT-type taxes unless neighbouring countries follow suit in fear of hurting its competitiveness in the region.

In May this year, MEED reported that GCC officials had adopted a draft agreement to implement VAT tax. Each GCC member agreed to issue a separate VAT law that includes the principles of the draft agreement.

At the time, no timetable was given for its implementation, with the UAE set to be the first to press ahead.

GCC governments are looking at ways to expand their revenue bases as oil and gas prices continue at significantly lower levels. The states have committed to high levels of infrastructure and welfare spending.

GCC countries have no personal income tax and low levels of corporate tax. This means government revenue is heavily dependent on hydrocarbons exports.